Tuesday, January 5, 2010

Iceland Gives the Finger to the UK

Interesting developments over in Iceland. They basically gave the finger to Great Britain and the Netherlands. The problem centers around 3.4 billion British Pounds that were lost when Iceland collapsed. Now this money should have been lost by the investors who took the speculative risk by putting money in Iceland. Well pappa government stepped in and reimbursed these losses. Pappa government (Great Britian and Netherlands) had been demanding Iceland pay back this debt. Pea Brained Iceland parliment members passed a bill agreeing to the repayment. The president than vetoed the bill much to the chagrin of pappa government (Great Britian) sending howls up across the pond.

From the Guardian:

Iceland was plunged back into crisis after its president refused to sign a bill promising to repay more than €3.8bn (£3.4bn) to Britain and the Netherlands after the collapse of the country's Icesave bank in 2008.

From a British news source. I think this helped alleviate the crises. It continues:

Almost 300,000 British savers had deposits with Icesave, attracted by market beating interest rates. Their accounts were frozen in October 2008, sparking a diplomatic row between Britain and Iceland, which had only recently begun to thaw. Britain outraged ordinary Icelanders at the time by invoking anti-terrorist legislation to freeze the UK assets of Landsbanki.

THIS IS THE FREAKING PROBLEM WITH OUR ENTIRE WORLD. Read that again. British savers put money in Iceland because it had higher interest rates. You have higher interest rates because of higher risk. If I remember correctly Iceland was over 10%. British citzens got greedy, took a gamble, and lost. Why doesn't Britian invoke anti-terroist legislation against the U.S. everytime a British tourist loses money in Vegas???? Its asinine.

The British and Dutch governments had compensated savers who lost money when Icesave's parent Landsbanki filed for bankruptcy. But both have since put pressure on Reykjavik to repay the money.

Those 300k British citizens didn't lose their money. Pappa govermnet came in and reimbursed them similar to an FDIC backing bad banks.

I commend the President of Iceland. There are people claiming international law was broken and causes international tensions. BS. Speculative failure occurred, losses need to be taken.


Anonymous said...

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Mrs. Watanabe said...

Some interesting photos of Iceland: